Welcome to the FIA News & Insights, a one-stop resource that includes insights from senior investment professionals on timely market events, their views on the economy and their respective markets. Find updates on the latest media information on Frost Investment Advisors, LLC and the most recent reprints, as well as, archival information for your reference.
Fed Hopes Raising Interest Rates and Balance Sheet Runoff can Cool Inflation and Avoid Recession
Last week, the Federal Reserve raised interest rates 50 basis points as expected. During the post meeting Q&A, when Chairman Jerome Powell was questioned about the likelihood of avoiding a recession, he quipped “I think we have a good chance to have a soft or softish landing.” Powell’s choice of words shows that the Fed is making an effort to manage the markets’ expectations in order to tighten policy in an orderly manner without adding to already heightened fears of a recession. Overall, his tone remains relatively optimistic, citing the ongoing strength of the economy, labor and excess savings of households.
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